Energy complaints up as competition report delayed

energy gas

THE NUMBER of serious complaints being made about our energy providers has risen - again - up 23% from 52,937 in 2014 to 65,168 last year, the energy ombudsman says.

Bills are still the biggest frustration for those resorting to the Ombudsman, accounting for 83% of the complaints they investigated.

That comes as no surprise to the thousands of customers of Scottish Power, Npower, and Co-operative Energy, all of whom have seen complaints rocket after moving to new billing systems.

Another 9% of the cases the Ombudsman took on related to "transfer issues" - that is, changing supplier, or moving to a different tariff with the same company.

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The good news is that despite more people complaining, the total number of issues regarding transfers has actually decreased a little - from 6,780 for the year up to the end of April 2015, to just under 6,000 for 2015 as a whole.

But these tend to be the most serious complaints, and therefore likely to be the tip of the iceberg: the Ombudsman can only investigate cases where the dispute has been going on for more than eight weeks, or has reached deadlock.

The Ombudsman also release quarterly figures for each of the main providers; the most recent set cover July to September last year.

Reflecting their dramatic fall from grace over the past couple of years, Scottish Power had the most complaints reach this stage, with 4554 complaints accepted by the Ombudsman - the equivalent of 89.2 complaints per 100,000 customers.

Almost 3,600 Npower customers - equivalent to 71.39 in every 100,000 with the company - had their complaints taken up.

The saving grace for both is that there's one company faring much worse.

The Ombudsman accepted 663 complaints about Co-operative Energy during those three months - that's 136 in every 100,000 of their customers taking their grievance to the most serious level.

At the other end of the scale, fewer than four in every 100,000 SSE customers had their complaint taken up by the Ombudsman.

Complaints up, prices up

It's hard to believe that just a couple of years ago , in 2013, the Ombudsman took on just 11,283 energy cases, spread fairly evenly throughout the year.

Something changed in 2014: by the time Ofgem decided to refer the domestic energy market to the Competition and Markets Authority (CMA) in that June, the Ombudsman had taken on more cases than they had in the whole of the previous year.

Ofgem said the resulting investigation would "help to rebuild consumer trust... by bearing down on prices while driving improvements in customer service and innovation".

Going by the detail in the reports the CMA have released during that investigation, the referral wasn't a moment too soon.

They've found that between 50% and 90% of customers of the Big Six suppliers are on a more expensive standard variable tariff, and that 95% of Big Six dual fuel customers could save at least £158 a year by moving tariff or supplier.

They've also found that despite the efforts of consumer groups and even Ofgem, there are potentially millions of households have no idea that they could save substantially; their own survey found that 36% didn't know it was possible to change supplier.

Winter of discontent

The CMA investigation
Energy market 'not working'
Feb 2015: Dual fuel customers 'should switch'
July 2015: 'Customers paying too much'

The CMA's initial recommendations, originally due to be published by the end of the month, are now expected in March.

After they made some bold proposals last summer, there are concerns that the feedback they've received could see them water down or even backtrack on some measures.

In the meantime, we're stuck paying more than we should; even Ofgem's chief executive Dermot Nolan has said that the drop in wholesale prices over the past year should have translated to bigger cuts to our bills.

And yet so far this winter only E.on have committed to cutting their prices; their standard variable gas tariff will be reduced by an average of 5.1% from the start of February.

They also announced the launch of a new fixed tariff, which they claimed was the cheapest available - although within days that was undercut by new fixed deals from SSE and First Utility.

In fact, Lawrence Slade, of the lobby group Energy UK, says the cheapest tariffs available are around £200 cheaper than they were this time last year, and that "there are now over 50 deals under £1,000 being offered by 30 suppliers".

But while the competition to be able to offer the cheapest fixed deal benefits the canny, it does nothing to help the millions still on standard or less competitive tariffs - like those offered to prepay customers, and many older people.

Depending on what the CMA say when they finally publish those recommendations, perhaps we can expect even more complaints about, and to, the energy companies in the near future.

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